Flashpoint 3/17/13

ól THE SPECULATION IS OVER. THE GOVERNOR NAMES KEVYN ORR DETROIT'S EMERGENCY FINANCIAL MANAGER. THEY'RE HERE THIS MORNING. AND PLUS THE ROUND TABLE ON A WEEK FULL OF RESOLUTION. TODAY IS SUNDAY, MARCH 17TH, 2013, AND THIS IS FLASH POINT. ? HELLO AND WELCOME TO FLASH POINT. I'M GUY GORDON. DEVIN IS RETURNING FROM ASSIGNMENT ON ROME. IT'S HARD TO REMEMBER WHEN WE HAD A WEEK FILLED WITH THIS MUCH ANTICIPATION AND IN SEARCH OF SO MUCH RESOLUTION. JURORS IN FEDERAL COURT, CARDINALS IN ROME AND MICHIGAN'S GOVERNOR ALL WITH CRITICAL, LONG-AWAITED DECISIONS WITH THE POTENTIAL IMPACT OF YEARS, IF NOT DECADES TO COME. JURORS DID DELIVER THEIR SAD VERDICT HERE IN COURT. CONVICTING EX-MAYOR KILPATRICK ON CHARGES AND CASE CLOSED. AND NEW HOPE FOR THE CATHOLIC CHURCH'S FUTURE. POPE FRANCIS, THE FIRST POPE FROM THE MEASURED-- AMERICAS. HUMBLY BEGINNING THE PONTIFICATE. AND THE EMERGENCY MANAGER TO UNDERTAKE WHAT MAY BE THE IMPOSSIBLE, TO STEER THE SHIP OUTSIDE OF THE ROCKS, OUT OF BANKRUPTCY. WHETHER IT CAN BE ACHIEVED. AND WE'LL TALK TO THE GOVERNOR AND THE CHOICE FOR EFM, WHETHER IT CAN BE FOR MONTHS, EVEN THOUGH IT'S LESS COMPLICATED CITY FOR SEVERAL YEARS. AND THE ROUND TABLE ON THE SELECTION AND PROSPECTS FOR SUCCESS. IT'S ALL AHEAD ON FLASH POINT. ? GOOD MORNING, AND WELCOME TO FLASH POINT. WE ARE JOINED BY GOVERNOR RICK SNYDER AND A GENTLEMAN IN THE NEXT FEW DAYS WILL OFFICIALLY BECOME THE DETROIT EMERGENCY FINANCIAL MANAGER, KEVYN ORR, WELCOME TO DETROIT. THANK YOU VERY MUCH. GOOD TO HAVE YOU HERE. GOVERNOR, IF THE DEFINITION OF SUCCESS FOR AN EMERGENCY FINANCIAL MANAGER, YOU COME IN, YOU FIX IT, YOU LEAVE. THERE ARE A LOT OF FOLKS WHO SAY WE HAVEN'T SEEN THE SUCCESS IN TERMS OF LEAVING THAT MANY OF THE EMERGENCY MANAGERS ARE STILL IN PLACE AND THAT THE JOB DOESN'T GET DONE. SO, WHY IS THIS THE RIGHT TOOL FOR A CITY THAT'S MORE COMPLICATED? WELL, GUY, THE POINT IS, PART OF THE PROBLEM IS THE OLD LAW WHICH DIDN'T PROVIDE ENOUGH TOOLS AND RESOURCES TO GET IN AND GET OUT. AND THAT GOES BACK TO 1990. AND SO, WE HAD PUBLIC ACT 4 WHICH HAD SOME ISSUES AND GOT REPEALED, I APPRECIATE THAT. WE HAVE A NEW LAW COMING IN LATER THIS MONTH, BUT WE'RE ACTUALLY WORKING ON THE TRANSITION PLAN FOR SEVERAL OF THE COMMUNITIES BECAUSE WE HAD THE OTHER LAW FOR LONG ENOUGH TO MAKE A DIFFERENCE. SO, WE'RE LOOKING AT TRANSITION PLANS FOR PONTIAC, FOR FLINT, FOR ECORSE, SO, SEVERAL OF THOSE COMMUNITIES WERE IN THE STARTING OF PROCESS OF SAYING HOW DO WE WORK WITH THE MAYORS AND CITY COUNCILS TO TRANSITION OUT. NOW, I CAN'T SAY THE EXACT DATES YET, BUT I THINK YOU'LL SEE THAT HAPPEN THE NEXT FEW MONTHS, THERE WILL BE AGREEMENT ON WHAT ARE THE TANGIBLE MILESTONES AND THE NEW LAW DOES A BETTER PLAN OF TRANSITIONING OUT AND IT'S WORKING. I THINK THAT'S THE GOAL HERE TO SAY BASICALLY THERE'S 18 MONTHS. AS I'VE SAID FROM DAY ONE, I DON'T WANT TO BE IN THE COMMUNITIES AND DON'T WANT-- YOU DON'T WANT TO BE IN THIS BUSINESS. NO, SO HERE IS A 18 MONTH PERIOD TO SAY PEOPLE HAD PLANS AND WORKING ON THINGS, BUT IT WASN'T GOING TO MOVE THE NEEDLE ENOUGH TO SOLVE THE PROBLEM AND GROW DETROIT. NOW WE'VE GOT 18 MONTHS, LET'S GO AND GET IT DONE AND WE'VE GOT THE BEST TO DO THAT. I'M HAPPY TO HAVE HIM ON BOARD AND HE'S OUTSTANDING INDIVIDUAL AND RIGHT PERSON FOR THE JOB. YOU'RE CONFIDENT YOU CAN GET THE JOB DONE IN 18 MONTHS WITH GOOD FAITH. BUT WE'VE HAD LEADERS IN TOWN WHO SAY WE'LL TAKE OUR CHANCES WITH A BANKRUPTCY JUDGE. HOW DO YOU JUDGE YOUR CHANCES? WELL, THE REALITY IS, WE WANT TO ENTER INTO DISCUSSIONS VERY QUICKLY. A LOT OF TIMES PEOPLE SAY THAT AND THAT'S FINE. THEY'RE CERTAINLY WELCOME TO THEIR CHOICES, BUT WE AT LEAST WOULD LIKE TO HAVE DIALOG TO BEGIN. MAYBE WE CAN EVEN NARROW THE POINTS DOWN BY WHICH THERE COULD BE DISAGREEMENTS SO THAT IF THAT IS THE EVENTUALLITY, WE HAVE TO SEE A BANKRUPTCY JUDGE IT'S FINITE AS OPPOSED TO BROAD. I RECOGNIZE THE SENTIMENTS AND SOME SIDES OF UNIONS SAYING, YOU KNOW WHAT, WE MIGHT AS WELL TAKE OUR SHOT, BUT I'D LIKE TO TRY TO DO THIS CONSENSUALLY. ONE. THINGS THEY POINTED TO, THE CITY CHARTER, THE MAYOR TRIED TO DO SOME THINGS, BUT ONE OF THE I AM PEDIMENTS, YOU CAN'T VIOLATE THE CITY CHARTER. ARE YOU TO SOME DEGREE LIMITED? THAT'S WERE CONSENSUAL. ANYBODY CAN AGREE TO MODIFY AN AGREEMENT IF THEY WANT TO. THERE ARE EMERGENCY FINANCIAL MANAGERS WHO TAKE PROVISIONS IN THE CITY CHARTER. BANKRUPTCY OF COURSE IS A FEDERAL LAW. IT OVERRIDES PROVISIONS OF FEDERAL LAW AND IMPAIRMENT OF CONTRACT AND OTHER STATE LAWS AND CITY CHARTERS. IT'S CERTAINLY A POWERFUL TOOL AND QUITE FRANKLY SHALL ONE THAT I'M TRYING TO AVOID THAT AT THE OUTSET. AND GOVERNOR, YOU'RE VERY BIG ON BENCHMARKING. I KNOW THAT YOU WILL BE WATCHING HIS PERFORMANCE. DO YOU HAVE AND HAVE YOU TALKED ABOUT WHAT THOSE BENCHMARKS WILL BE FOR 60 DAYS, 90 DAYS, WHAT YOU WANT TO SEE ACCOMPLISHED, A PUNCH CARD, IF YOU WILL? NO, BUT I'VE HAD THE DISCUSSION WITH KEVIN ABOUT ESTABLISHING THAT KIND OF STRATEGIC TIMETABLE TO SAY THERE'S 18 MONTHS AND NOW LET'S ENGINEER BACKWARD TO SEE THE GOALS. I DON'T WANT TO DO THAT. KEVIN IS IN THE POSITION NOW AND I'M COUNTING ON HIM TO SAY THE TIME HE THINKS IS WORKABLE. LET'S GET ON BOARD AND WORK TOGETHER TO MAKE THAT HAPPEN BECAUSE I'M THERE TO BE A SUPPORTER, TO BE A COACH, TO BE A RESOURCE PROVIDER TO BOTH HIM AND TO THE CITY TO SAY HOW DO WE TURN THIS AROUND? BECAUSE WE ALL HAVE THE SAME OUTCOME. WE ALL WANT TO GROW THE CITY. THERE ARE SMART FOLKS IN THE CHEAP SEATS WATCHING THIS. WE HAD A REPORT FROM MICHIGAN STATE. BEFORE YOU SAY MR. WOLVERINE-- THAT STATES THE HEALTH CARE BURDEN UNFUNDED PORTION WE'D HAVE TO PAY TO GET IT UP TO SNUFF. $7,000 FOR EVERY MAN, WOMAN AND CHILD. I'VE HEARD THAT. AND GIVEN THAT INCREDIBLE BURDEN AND LIMITATIONS WHAT YOU CAN DO WITH PENSIONS AND BENEFITS, ISN'T THIS JUST AN INTERMEDIARY STEP TOWARDS BANKRUPTCY? YOU KNOW, A LOT OF PEOPLE HAVE BEEN SAYING THAT AND I'VE HEARD THAT METRIC BEFORE. I DON'T THINK SO. I THINK THAT EXACTLY AS YOU HEARD THE INFORMATION, THE OTHER CONCERNED PARTIES ARE, IF THEY WANT TO MAKE A MOVEMENT FOR THE INTEREST OF THE CITY THAT ALL STAKE HOLDERS COME TOGETHER. THE DEBT STAKE HOLDERS AND PENSION AND BENEFITS GUARANTEES, AND I EMPHASIZE THAT POINT. IF THEY DO NOT WANT TO WORK THAT OUT THAT'S CERTAINLY A TOOL AVAILABLE TO US. YOU EXTENDED A BIT OF AN OLIVE BRANCH AT YOUR INTRODUCTION, SAYING LOOK, IT'S NOT A PUNITIVE THING WITH THE CITY COUNCIL, THE FACT THAT THEY HAVE SOME VERY, VERY LOUD AND VOCAL CRITICS. BUT YOU DIDN'T SAY THAT YOU WOULDN'T DEFUND THEM EITHER. SO WHAT WILL DETERMINE WHETHER OR NOT WE DEFUND THE MAYOR'S OFFICE OR THE CITY COUNCIL? FIRST OF ALL, WE'RE GOING TO GET IN AND WE'RE GOING TO LOOK AT THE ANALYSIS OF THE METRICS OF DOLLARS AND CENTS THAT REALLY GO INTO THAT. I REALLY MEANT WHAT I SAID. THIS IS GOING TO BE A DATA DRIVEN PROCESS WITH AN OVERLAY OF UNDERSTANDING OF THE REAL WORLD CONSEQUENCES. THERE MAY BE REDUN-- REDUNDANTSIES, SOMETIMES YOU CAN DEAL WITH FUNDING AND STAFFING BY ATTRITION, BUT WHAT I WAS TRYING TO RELATE TO THE CITY COUNCIL, THIS PROCESS WILL NOT BE DRIVEN BY VITRIOL OR SOME SENSE IF YOU WORK WITH ME YOU'LL GET A CHIT. IF YOU DON'T WORK WITH ME IT WILL BE SOMETHING PUNITIVE. I DON'T HAVE ANY INTEREST OR INTENT IN THAT REGARD. WON'T YOU TO SOME DEGREE HOLD IT AGAINST THEM AS YOU WOULD ANYBODY ELSE THAT GETS IN THE WAY OF ACHIEVING THE MISSION? I'M FOCUSED ON MY GOAL. AND I UNDERSTAND THAT SOME CITY COUNCIL PEOPLE MAY HAVE A DIFFERENCE OF OPINION THAN MINE, THAT'S DEMOCRACY AND THEY ARE ELECTED OFFICIALS. I'M SO FOCUSED ON DOING THIS AS OPPOSED TO THE OTHER STUFF. I'D RATHER HAVE THEM WITH ME. IF THEY'RE NOT, IT'S NOT GOING TO CAUSE ME TO CHANGE MY GOAL AND FOCUS. YOU MENTIONED DEMOCRACY. I NOTICED DURING THE INTRODUCTION, YOU WERE AN OBAMA POLL WATCHER. IN THAT ROLE I THINK A LOT OF FOLKS SITTING BACK HERE, IF YOU'RE THAT KIND OF A GUY, YOU BELIEVE IN DEMOCRACY ENOUGH YOU WERE COMMITTED TO THAT DEGREE, HOW CAN YOU TAKE ON A ROLE THAT THEY BELIEVE NULLIFIES THE VOTE IN TERMS OF REPRESENTED DEMOCRACY? I WANT TO ADDRESS THAT STRAIGHT UP. THERE ARE THREE COMPONENTS TO IT. THE FIRST ONE IS THE CONCEPT OF RECEIVERSHIP, CONSERVATORSHIP, TRUSTEESHIP IS OLD AS LAW, AND THIS HAS PRE-CONDITIONS TO IT, THERE HAS TO BE A FINANCIAL EMERGENCY, ADOPTED PURSUANT TO A STATUTE ENACTED BY THE LEGISLATURE, WHICH IS DUE PROCESS, A THIRD BRANCH OF GOVERNMENT. AFTER ADVICE TO THE GOVERNOR, HE MAKES HIS DECISION TO APPOINT AN EMERGENCY MANAGER, THAT'S DEMOCRACY, THAT'S THE PROCESS. AND I RECOGNIZE TO SOME PEOPLE IT APPEARS MY VOTE DOESN'T COUNT. THE THIRD COMPONENT THE GOVERNOR IS THE CHIEF EXECUTIVE OF THE STATE. ALL POLITICAL SUBDIVISIONS OF STATE OF COMPONENTS OF STATE, INCLUDING A CITY. I THINK MANY DETROITERS WOULD SAY, NO OFFENSE, GOVERNOR, WE DIDN'T VOTE FOR YOU, AND WE CERTAINLY DIDN'T VOTE FOR YOU. THAT'S FINE. . I'M NOT AN ELECTED OFFICIAL, BUT THEY OPERATE UNDER THE STATE CONSTITUTIONS AND STATE LAWS, THOSE ARE SUPREME TO THE STATE MUNICIPALITY, THAT'S THE DEMOCRAT SICK SYSTEM WE'RE OPERATING UNDER. ONE OF THE THINGS YOU POINTED OUT AND IT'S INTERESTING, YOU'RE A C.P.A. AND A NUMBERS GUY. IN SOME WAYS THE NUMBERS WEREN'T TRUSTED. WE DIDN'T KNOW HOW MUCH OF THE COPS WERE ON THE BEAT AND UNCLEAR HOW MUCH OF THE PENSION IS FUNDED. HE WANTS TO BE DATA DRIVEN. DOES HE HAVE ENOUGH DATA. THERE'S A LOT OF DATA OUT THERE, AND SOME OF IT IS GOOD. AND FROM THE OPERATIONAL, THAT NEEDS IMPROVEMENT. AND THAT'S SOMETHING TO LOOK AT HOW DO WE LOOK AT PUTTING NEW SYSTEMS IN PLACE AS QUICKLY AS POSSIBLE. HOW DO WE GET THIS INFORMATION? BECAUSE THAT JUST PROVIDES, THAT'S AN OPPORTUNITY TO SAY, THIS IS HOW WE CAN HELP SAVE MONEY AND PROVIDE BETTER SERVICE AND ACTUALLY, HOPEFULLY HAVE THE OPPORTUNITY TO HAVE PEOPLE THAT MIGHT HAVE BEEN DOING WORK ON THE OFFICE AND GET THEM ON THE FRONT LINES WHERE THEY CAN GO HELP PEOPLE. YOU MENTIONED SERVICES, WERE YOU GOING TO BE EXPERIENCING DETROIT SERVICES FIRSTHAND OR LIVING IN THE CITY AND WHERE YOU'RE GOING TO BE IN A HIGH RISE TOWER OR ON THE GROUND? I'M GOING TO BE LIVING IN THE CITY AND FRANKLY, GUY, I WAS DRIVING AROUND LAST NIGHT AND THIS MORNING, THE CITY HAS A VIBRANT, HAS A FEEL TO IT IN THE CENTRAL BUSINESS DISTRICTS AND I UNDERSTAND IN THE NEEDS, NEIGHBOR HOODS THERE'S A-- I RECOGNIZE THERE'S A NEED AND EXPECTATION FOR THINGS TO CHANGE, BUT THE LEVEL OF SUPPORT, COMMITMENT AND SPIRIT I'VE BEEN FEEL FROM THE PEOPLE SUGGEST THAT MAJORITY OF PEOPLE ARE READY FOR IT. YES, I'M GOING TO BE HERE AND FOCUS ON THAT. FINAL QUESTION, WHAT IS THE FIRST SERVICE THAT YOUR INFLUENCE WILL BE MANIFESTED IN IN TERMS OF IMPROVEMENT? THE DELIVERY WILL BE-- I DON'T KNOW THE FIRST ONE BECAUSE THERE'S SOME IN THE PIPELINE, BUT IT MAY BE THINGS AS SIMPLE AS GETTING LIGHTING UP BEFORE THE SUMMER STARTS. IT MAY BE GETTING BETTER EQUIPMENT TO THE POLICE AND FIRE. MY FIRST FOCUS IS ON PUBLIC SAFETY. ALL RIGHT. AND GENTLEMEN, THANKS SO MUCH. GOOD LUCK IN YOUR ENDEAVOR. THANK YOU VERY MUCH, GUY. WE HOPE YOU'LL STAY IN CLOSE CONTACT AND CHECK THE PROGRESS. HAPPY TO DO IT, OKAY. WE'LL BE BACK WITH OUR ROUND TABLE RIGHT AFTER THIS. WELCOME BACK TO FLASH POINT. PLENTY TO TALK ABOUT WITH THE ROUND TABLE TODAY AND JOINING ME TO TALK ABOUT WHAT COMES NEXT FOR DETROIT ON MANY AVENUES IS BRANDON JESUP FROM MICHIGAN FORWARD. TO HIS LEFT STEPHEN HENDERSON OUR GOOD FRIEND FROM THE DETROIT FREE PRESS, EDITORIAL CHIEF AND HIS COUNTERPART AT DETROIT NEWS, NOLAN FINLEY AND CRAIG, FROM WDTE-FM. GOOD TO HAVE YOU WITH US. KEVYN ORR SAYS HE BELIEVES HE CAN GET THIS DONE VERY QUICKLY WITH PEOPLE OF GOOD FAITH COMING IN TOGETHER AND RECONCILING. GIVEN ALL OF THE CONTROVERSY, STEPHEN, CAN HE FIND PEOPLE OF GOOD FAITH WILLING TO COMPROMISE AND COME TO AGREEMENT. WELL, YOU'RE NOT DETROIT, SO-- (LAUGHTER) HE'S NOT FROM AROUND THESE PARTS. YES. HE'S ENTITLED TO THAT LEVEL OF OPTIMISM UPFRONT, I THINK, PRETTY QUICKLY HE WILL SEE THE KIND OF INTRACTABLE POLITICAL BATTLES THAT WE HAVE. I THINK HE'S THE KIND OF GUY WHO HAS A SKILLSET THAT WILL BE ABLE TO NAVIGATE THAT AND GET US QUICKLY TO SOLUTIONS, BUT IT'S NOT GOING TO BE AS COOPERATIVE AS I THINK HE'S ANTICIPATING UPFRONT. BUT I DON'T THINK HE'S AS NAIVE AS THAT STATEMENT WOULD PRESUME. I MEAN, HE ALSO TALKS ABOUT THE LEVERAGE, AND THE HAMMER AND THE TOOL. RIGHT. AND USING THAT BANKRUPTCY TO SORT OF PERSUADE PEOPLE WHO MIGHT NOT OTHERWISE BE INCLINED TO GOOD FAITH TO GET THERE. HE'S A TOUGH, TOUGH GUY. FIST IN A VELVET GLOVE. HE DIDN'T PULL PUNCHES ABOUT THE HAMMER. HE HAS DONE THIS, AND HE KNOWS HOW TO MUSCLE. HE TALKS A CONCILIATORY GAME THE FIRST COUPLE OF DAYS, BUT KNOWS HOW TO APPLY THE MUSCLE. THINK ABOUT THAT EXPERIENCE WITH CHRYSLER. THAT WAS NOT AN EASY BANKRUPTCY FOR CHRYSLER. MOST PEOPLE THOUGHT THIS WAS A COMPANY WAS GOING TO BE LIQUIDATED. HE MUSCLED THESE GUYS AND GOT THEM TO TAKE PENNIES ON THE DOLLAR AND HE'S GOT THAT SKILLSET. AND THERE'S A REASON GOVERNOR SNYDER BROUGHT HIM IN INSTEAD OF A CITY MANAGER TYPE PERSON. THIS IS A SPECIFIC SET OF GOALS, I THINK, THAT HE HAS. AND THIS IS A DIFFERENT L LANDSCAPE AS WELL. THIS IS A CITY, A LOT OF PEOPLE COME WITH A LOT OF IDENTIFIES. YOU'VE GOT THE YUNAN A COME WITH TENTATIVE AGREEMENTS THAT THE MAYOR HAS SAT ON AND CITY COUNCIL HAS SAT ON. THE FACT IS, IF DETROIT HAVE ACTIONS AND CITIZENS OF DETROIT HAVE TO TAKE ACTION ALONG WITH THE EMERGENCY MANAGER, POLICY CHANGES ARE NEEDED WITH RETIREE HEALTH CARE HAS TO BE DONE BY CITY COUNCIL. DID HE STRIKE THE RIGHT TONE? HE STRUCK A TONE, BUT THE TONE MEANS NOTHING, IT'S ABOUT ACTION. I'M A DETROITER JUST LIKE EVERYONE ELSE HERE AT THE TABLE AND WE'VE BEEN THIRSTY FOR ACTION OVER 30 YEARS. TONE IS GREAT, BUT WHAT IS YOUR ACTION PLAN? WE PROBABLY WON'T SEE THAT FOR OVER FOUR MONTHS NOW AND THAT'S WHAT WE'RE WAITING ON THE ACTION PLAN. YOU SAID IT DEPENDS ON CITY COUNCIL. WE HAVE TO CLARIFY, ABSOLUTELY NOTHING FROM HERE ON OUT UNTIL THAT MANAGER-- I WANT TO BE CLEAR, YES, AN EMERGENCY MANAGER HAS BOTH POWERS OF GOVERNMENT AND THAT'S THE PROBLEM. THE FACT IS THAT THESE NEXT TWO WEEKS, CITY COUNCIL HAS SOME RESOLUTIONS ON THE TABLE, SOME RESOLUTIONS TO ADDRESS, ABSOLUTELY, AND THEY CAN DO THAT. LET'S REMOVE THE WORK FOR HIM OFF THE TABLE NOW AND WE CAN DO THAT AND MAKES A GOOD FAITH EFFORT FOR DETROIT AND MAKE SURE THAT WE DON'T GET TO THE DRASTIC EFFORTS OF SELLING PUBLIC ASSETS AND LOSING PUBLIC TRUST. THAT'S A PROBLEM. STEPHEN, A GOOD FIRST STEP MAYBE TAKING THE CONSENT AGREEMENT, A BLUEPRINT EVERYBODY AGREED ON, DIDN'T GET EXECUTED FULLY. IS THAT A GOOD FIRST STEP, LET'S USE THIS? I THINK THE ITEMS IN THE APPENDIX, THINGS INTENDED TO IMPROVE SERVICE DELIVERIES TO DETROIT EARS, THAT'S A GREAT PLACE TO START IN TERMS OF BUILDING GOODWILL. UNFORTUNATELY A LOT OF THINGS WON'T DEAL WITH THE FINANCIAL ISSUES, THE FINANCIAL EMERGENCY THAT YOU HAVE. SO YOU'VE SORT OF GOT TO DO A COUPLE OF THINGS AT ONCE. YOU WANT TO DO THINGS THAT DETROITERS WILL NOTICE AND SAY, THINGS ARE STARTING TO GET BETTER, BUT YOU ALSO HAVE GOT TO BALANCE THE BOOKS AND SOME OF THAT WILL BE UNPOPULAR. AND SO IT'S A MIX OF THOSE TWO. I THINK HE'S GOING TO BE JUST AS AGGRESSIVE GOING AFTER THE BONDHOLDERS AS TRYING TO GET CONCESSIONS AND THAT'S WHAT HE'S GOT TO FREE UP CASH ON DEBT SERVICE EVERY MONTH TO BE PUMPED BACK INTO THE SERVICES OF THE CITY OF DETROIT. AND THAT'S THE TOUGHEST NUT TO CRACK. THE BONDHOLDERS, IN A MUNICIPAL-- THERE'S NOT THE SAME HIERARCHY. NOT LIKE CHAPTER 11. A LOT HARDER TO MUSCLE-- THE QUESTION, IS THIS AN INTERMEDIARY STEP TO A BANKRUPTCY? WE'LL TACKLE THAT WHEN WE COME BACK ON FLASH POINT. STAY WITH US. WELCOME BACK TO FLASH POINT. STEVE AND BRANDON, I THINK THAT KEVYN ORR WAS FAIRLY BLUNT. HE MAY HAVE TO PULL THE BANKRUPTCY TRIGGER. BUT COULD IT BE FOR THE PENSION BURDEN AND GET THAT FIXED AND THE RETIREE HEALTH CARE BURDEN. WE LOOK AT THE STUDY, $7,000 FOR EVERY MAN, WOMAN AND CHILD TO GET IT FULLY FUNDED? AND WE CAN AVOID BANKRUPTCY, DETROIT CAN AVOID BANKRUPTCY. AS I ALLUDED TO EARLIER ABOUT POLICY CHANGES. RIGHT NOW A RETIREE FOR THE DETROIT POLICE DEPARTMENT MAY RETIRE BEFORE HE'S 50. AND WE'VE GOT TO CHANGE THAT. IF THE SAME POLICE OFFICER-- HIS CONSUMPTION SPAN. YES, AND NEXT HIS FUTURE AND HIS HEALTH CARE COSTS AND THE CITY OF DETROIT. RIGHT NOW THE CITY OF DETROIT IS THE FIRST PAYER ON ALL RETIREE HEALTH LIABILITIES AND COSTS US $177 MILLION LAST YEAR. WE CAN REDUCE AT THAT COST SIGNIFICANTLY BY JUST MAKING A SIMPLE POLICY CHANGE. SECONDLY LET'S TALK ABOUT STATE AND LOCAL COOPERATION. WE'VE GOT A TAX LOOPHOLE KILLING 22 LOCAL MUNICIPALITIES, AND BUSINESSES DON'T HAVE TO WITHHOLD LOCAL TAXES. AND THIS COULD BRING TO THE CITY COFFERS AND ENDS OUR SHORT-TERM CAPITAL DEFICIT IN A FEW MONTHS. WE KNOW THAT YOUR NEWSPAPER REVEALED THAT 50% OF TAXPAYERS ARE NOT. AND WHAT CAN HE DO ABOUT THAT? YOU'VE GOT TO FIX COLLECTIONS AND YOU'VE HAD PEOPLE NOT PAYING TAXES FOR A COUPLE OF YEARS AND SIMPLY YOU'RE GOING TO COLLECT? AND WHAT'S YOUR HAMMER? CON IF I IF I-- CONFISCATE TAXES? HALF THE PEOPLE THAT AREN'T PAYING TAXES, AREN'T IN THE SYSTEM AND DON'T KNOW WHO THEY'RE GOING AFTER. AND THE PROPERTY TAXES AND THERE WAS A LOSS AND THINGS LIKE THAT, WE'VE GOT A HUGE RECORD KEEPING IN THE CITY OF DETROIT AND WE DON'T HAVE A CENTRAL DEPOSITORY OF DETROIT'S INFORMATION. AND LET'S BE CLEAR IN THE ASSESSMENTS THE CRASH OF POST 2005. THIS ASSESSMENT IS WAY OUT OF LINE. I'M PAYING THE HIGHEST MILLAGE RATE OF THE UNITED STATES. YOU'VE GOT TO FIX IT, GET HONEST ASSESSMENTS AND GO AFTER PEOPLE WHO DON'T PAY TAXES. YOU ASKED ABOUT BANKRUPTCY AND WHETHER THE CITY CAN AVOID IT? THERE ARE THINGS THE EMERGENCY MANAGER CAN DO TO FIX THE FINANCES AND GET THE MONEY, ROLL IT IN. THERE ARE THINGS OUTSIDE OF HIS CONTROL AND ONE IS THESE CREDIT SWAPS, 240 MILLION THAT WERE TIED TO AN EARLIER REFINANCING OF THE DEBT. THE BANKS AND CREDITORS CALL THOSE IN, THEY'RE IN BANKRUPTCY AND OUTSIDE OF HIS CONTROL. EXCEPT IT'S NOT REALISTIC FOR SOMEONE TO CALL THAT IN. THE CITY DOESN'T HAVE THAT MONEY. AND THEY HAVE-- , BUT THEY DO CALL IT IN AND THEY'RE NOT GOING TO GET IT. AND NOW YOU'RE FORCING US INTO BANKRUPTCY WHERE YOU GET NINE CENTS ON THE DOLLAR FOR THAT. AND HE'S KEEPING THAT BANKRUPTCY LEVEL OUT THERE, BUT THERE'S ALSO THE IDEA IF YOU GO TO THE CREDITORS AND YOU CAN'T GET A DEBT RESTRUCTURING, YOU'RE LOOKING AT BANKRUPTCY. YOU ARE. IF YOU GO TO THE PENSIONS AND CAN'T GET AROUND THE CONSTITUTIONAL SORT OF LIMITS ON WHAT YOU CAN DO TO ADJUST PENSION OBLIGATIONS, YOU COULD END UP-- ASK FAIR TO SAY THAT IT'S NOT A HAMMER AGAINST THE CITY OF DETROIT. IT'S A HAMMER AGAINST OUR CREDITORS. IF OUR CREDITORS GO TO-- AND I DON'T THINK THAT'S LOST ON PEOPLE IN DETROIT. WHAT THEY NEED TO KNOW, THERE'S NO AMOUNT OF CUTTING THAT CAN HAPPEN IN THE CITY THAT'S GOING TO FIX THE PROBLEM. YOU CAN SELL OFF BELLE ISLE THAT'S NOT GOING TO FIX THE PROBLEM. THEY NEED CONCESSIONS FROM BONDHOLDERS AP I THINK THAT'S WHY HE'S HERE. AND THE PENSION COST, THE BIGGEST PIECE OF THIS. WE WOULD BE REMISS IF WE CAN'T PUT PUNCTUATION AT THEENED OF THE KWAME KILPATRICK SAGA. DO YOU THINK WE HAVE A LEARNED OUR LESSON? I THINK HE'S LEARNED HIS LESSON. FOR EVERYBODY ELSE, DON'T DO IT. THIS IS A GUY WHO HAD TREMENDOUS POTENTIAL AND REMINDED LAST WEEK, SENATOR CARL LEVIN DECLARED KWAME KILPATRICK WOULD HAVE BEEN A CANDIDATE FOR THAT IF HE HAD NOT DONE THIS. IT'S NOT WORTH IT. THIS IS A GUY WHO KWAN SQUANDERED HIS ENTIRE LIFE AND SAD. THE VOTERS OF DETROIT LEARNED AND ELECTED LAST TIME. IT'S BEEN A BUSY NEWS WEEK AND THANKS FOR JOINING US ON FLASH POINT. DEVIN WILL BE BACK NEXT WEEK.

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